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Judgment
While admitting this revision on 26th April, 2000 the following question of law was framed by this Court for consideration:
"Whether on the facts and in the circumstances of the case, the Tribunal was justified in holding that Section 5(3) of the Central Sales Tax Act, 1956 was not attracted?"
In para 3.1 of the order dated 5th January, 1995 of the Sales Tax Appellate Tribunal (‘Tribunal’) giving rise to the present reference, the relevant facts are set out as under:
"Now coming to the point with regard to the claim for deduction under Section 5(3) of the CST Act, the position can be analysed as follows:-
True, there was an export contract by a foreign buyer with the Indian Export House for purchase of groundnuts, M/s. Tanna Exporters Pvt. Ltd., M/s.
Tanna Exporters Pvt. Ltd. have entered into an agreement with the appellant-dealer dated 1.3.86, 7.3.86 and 8.3.86 for purchase of H.P.S. Groundnut seeds. This shows that the groundnuts were purchased by the exporter from M/s.K.R. Oil Industry. M/s. K.R. Oil Industry are not the exporters, M/s. K.R. Oil Industry, i.e. the appellant-dealer, purchased the goods locally. The taxable event occurred in the hands of M/s. K.R. Oil Industry, who are not the exporters, Sub-section (3) of Section 5 of the CST Act, 1956, the last sale or purchase of any goods preceding the sale or purchase occasioning the export of those goods but of the territory of India shall be deemed to be in the course of such export, if such last sale or purchase took place after and was for the purpose of complying with, the agreement or order for or in relation to such export. In the present case, the purchase made by the appellant-dealer is not a purchase occasioning the export of the goods out of the territory of India. This being the position, we are of the opinion that the purchase effected by the assessee cannot be deemed to be a purchase in course of export. Hence, the claim put forth on behalf of the appellant in this regard is not sustained."
Section 5(3) of the CST Act reads as under:
"5. When is a sale or purchase of goods said to take place in the course of import or export.—
(1) xx xx xx
(2) xx xx xx
[(3) Notwithstanding anything contained in sub-section (1), the last sale or purchase of any goods preceding the sale or purchase occasioning the export of those goods out of the territory of India shall also be deemed to be in the course of such export, if such last sale or purchase took place after, and was for the purpose of complying with, the agreement or order for or in relation to such export"
It is plain that there were two transactions preceding the actual export i.e. the present Assessee - K.R. Oil Industry selling groundnuts to Tanna Exporters, who then sold it to Indian Export House, which then exported the consignment. The transaction involving the Petitioner is not the one immediately preceding the transaction that occasioned the export. Section 5 (3) of the CST Act is not attracted. The question is accordingly answered in the affirmative i.e. against the Assessee and in favour of the Opposite Party (Department).
The revision petition is disposed of.
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